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It's easy to match the overall market return by buying an index fund. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. That downside risk was realized by C Cheng Holdings Limited (HKG:1486) shareholders over the last year, as the share price declined 49%. That contrasts poorly with the market return of -5.0%. Longer term shareholders haven't suffered as badly, since the stock is down a comparatively less painful 26% in three years. Shareholders have had an even rougher run lately, with the share price down 30% in the last 90 days. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.
See our latest analysis for C Cheng Holdings
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
Unfortunately C Cheng Holdings reported an EPS drop of 75% for the last year. This fall in the EPS is significantly worse than the 49% the share price fall. So despite the weak per-share profits, some investors are probably relieved the situation wasn't more difficult.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
Dive deeper into C Cheng Holdings's key metrics by checking this interactive graph of C Cheng Holdings's earnings, revenue and cash flow.
What about the Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between C Cheng Holdings's total shareholder return (TSR) and its share price return. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that C Cheng Holdings's TSR, which was a 49% drop over the last year, was not as bad as the share price return.
A Different Perspective
While the broader market lost about 5.0% in the twelve months, C Cheng Holdings shareholders did even worse, losing 49%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. On the bright side, long term shareholders have made money, with a gain of 7.8% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. If you would like to research C Cheng Holdings in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.